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Ringing Off The Hook: TCPA Issues Still At Forefront As Calendar Turns To 2016

We may only be three weeks into 2016, but the Telephone Consumer Protection Act (“TCPA”) has already received a considerable amount of attention this year.

Yesterday, the U.S. Supreme Court determined in Campbell-Ewald Co. v. Gomez, that a defendant could not cut off a TCPA class action lawsuit by making an offer of settlement to the lead plaintiff in an amount that would fully satisfy his claims.  Specifically, a defendant company that sent a single SMS text message to the lead class action plaintiff made an offer of judgment for $1503 (i.e., the statutory value of a single TCPA violation, trebled for willful misconduct).  The lead plaintiff rejected this offer.

In determining that the offer of judgment amounted to nothing more than an unaccepted contract offer, the Supreme Court eliminated a tactic TCPA class action defendants could use in the past to in limit class action liability. This means that companies that initiate autodialed outbound calls should remain vigilant in terms of reviewing policies and terms and conditions of service to limit exposure to costly litigation.

Separately, Federal Communications Commission (“FCC”) Commissioner Michael O’Rielly, one of two commissioners who voted against the FCC’s June 2015 Declaratory Ruling and Order expanding TCPA protections, has stated on multiple occasions his belief that that the FCC is using its enforcement authority improperly to make policy.  Commission O’Rielly contends that by issuing citations for conduct that does not clearly violate the language of the TCPA, the FCC is seeking to regulate terms of companies’ service agreements in a manner that exceeds the agency’s authority.

Earlier in the year, Commissioner O’Rielly raised similar concerns in a blog post on the FCC’s official website.  In addition to raising process, Commissioner O’Rielly expressed that he found “startling” the fact that “the FCC has been known to issue a press release before the target even receives its citation copy.”

In particular, Commissioner O’Rielly singled out citations issued last September to ride sharing company Lyft and First National Bank. We mentioned these citations in a posting, noting that the FCC alleged that Lyft and First National violated the TCPA by requiring customers to consent to autodialed calls and text messages as a condition of receiving the companies’ services.  Although both companies disagreed with the FCC’s actions, they did modify their terms and conditions to remove the allegedly offending language.

Finally, on January 15th, the Federal Communications Commission (“FCC”) filed its response to the D.C. Circuit, opposing a number of challenges to the June Declaratory Ruling and Order brought by a number of industry groups.  Not surprisingly, the FCC argues that its broad definition of the term “autodialer” is reasonable.  The FCC also argues that its rules allowing only one call to reassigned wireless numbers and permitting called parties to revoke consent to receive autodialed calls are reasonable and consistent with the TCPA.

We will continue to advise on the proceedings in the D.C. Circuit as they occur.

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Paul Abbott